The Pittsburgh Urban Redevelopment Authority is set to create two new social impact pilot programs aimed at encouraging minority entrepreneurship and business expansion.
URA Ventures and the Minority and Women-Owned Business Development Equity Fund programs will provide venture capital to minority and women-owned businesses.
The redevelopment authority hopes to raise $5 million in capital to fund the programs, using cash from their own revenue streams, the US federal bailout law and other public and private sources.
The URA board will vote on program guidelines for both initiatives at their virtual meeting on Thursday.
“The City of Pittsburgh offers tremendous economic opportunity,” said Mayor Ed Gainey. “But we need to work together to make sure this opportunity is fair and empowers MWBE entrepreneurs who have been left behind for too long. If we want to develop our city, we must develop and invest in our minority businesses. »
Pittsburgh has the lowest rate of Black-owned businesses among the nation’s 50 largest metropolitan areas, the redevelopment authority said.
“Many companies and founders of MWBE find it difficult to access venture capital and cash to grow their businesses and sponsor real estate development projects,” said URA Chief Strategy Officer Thomas Link. “The URA has a long and successful history of investing directly in small businesses and supporting MWBE businesses through debt and investment products such as the Micro Enterprise Loan Fund, the ready for the takeover and growth of minority businesses and other tools.”
URA Ventures is a diversity-focused seed fund that will seek to invest in businesses located in the city.
The goal of the program is “to change the fact of entrepreneurship by making strategic investments and accelerating access to and availability of capital for historically disadvantaged small businesses, while creating quality jobs and driving growth.” economy in the city of Pittsburgh”.
Three programs planned
The initiative will launch three programs: Main Street Ventures, Pittsburgh Entrepreneur Fund 2.0 and Venture Co-Investment.
The URA plans to allocate at least $3 million to the program, with the aim of impacting 41 businesses and creating more than 80 jobs.
The $2 million MWBE Developer Equity Fund will provide direct equity investment in MWBE-sponsored real estate development projects through a shared risk-reward structure that aims to strengthen the developer of the development and provide a return on investment for the URA.
The programs will be funded through a combination of federal Community Development Block Grant funds, redevelopment authority revenue streams, and other local, state, or federal sources.